I've been absolutely flabbergasted that the US has not been a little bit more planned as to how they would deal with this very, very predictable situation. Starting a war in the Persian Gulf, a region that produces roughly a third of the world's oil, was bound to send shock waves through global markets.
About 20% of the world's oil and liquid natural gas pass through the strait, and the sudden traffic halt has sent prices soaring. But that spike also promises a massive payday for any ships willing to make their deliveries. Freight rates have soared to record highs, and a very large crude carrier heading from the strait to China can earn about $500,000 in revenue per day.
There's no doubt that what's happening now is an order of magnitude bigger - in terms of potential fallout for oil markets - than Russia's invasion of Ukraine. The global benchmark Brent crude is trading around $88 Friday morning, up roughly $16 since military strikes against Iran began.
